inkinccorporation@gmail.com Delhi High Court
Vineet Gupta vs Union Of India And Ors. & Anr on 10 February, 2026
Author: Purushaindra Kumar Kaurav
Bench: Purushaindra Kumar Kaurav
$~69
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ W.P.(C) 7850/2025
Date of Decision: 10.02.2026
IN THE MATTER OF:
1. VINEET GUPTA
S/O SHRI JAI DEV GUPTA, AGED ABOUT 56 YEARS,
RESIDENT AT A-130, NEW FRIENDS COLONY, NEW
DELHI - 110025
INDIAN CITIZEN HAVING
PASSPORT BEARING NO - Z8227827 ... PETITIONER NO. 1
2. PRANAV GUPTA
S/O SHRI JAI DEV GUPTA, AGED ABOUT 58 YEARS,
RESIDENT AT H. NO. 481, SECTOR 6, PANCHKULA,
HARYANA - 134109
INDIAN CITIZEN HAVING
PASSPORT BEARING NO - C8875594 ...PETITIONER NO. 2
Through: Ms. Neeha Nagpal, Mr. Malak Bhatt,
Mr. Ajatshatru Singh Rawat and Mr.
Nishta Juneja, Advs.
versus
1. UNION OF INDIA
THROUGH BUREAU OF IMMIGRATION
DEPUTY DIRECTOR
EAST BLOCK --VIII, LEVEL -2,
SECTOR -1, R.K PURAM, NEW DELHI-66
... RESPONDENT NO. 1
2. BANK OF BARODA
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 1 of 24 KUMAR KAURAV
THROUGH ITS MANAGING DIRECTOR & CEO
AND
ALSO, THROUGH ITS BRANCH MANAGER
HAVING ITS BRANCH OFFICE AT
SCO 62-63, BANK SQUARE,
SECTOR 17-B, CHANDIGARH
.....RESPONDENT NO. 2
3. UNION BANK OF INDIA
THROUGH ITS MANAGING DIRECTOR & CEO
AND
ALSO, THROUGH ITS BRANCH MANAGER
HAVING ITS BRANCH OFFICE AT
4/14 ASAF ALI ROAD, NEW DELHI
...RESPONDENT NO. 3
Through: Mr. Santosh Kumar Rout. Adv. for R-
2.
CORAM:
HON'BLE MR. JUSTICE PURUSHAINDRA KUMAR KAURAV
JUDGEMENT
PURUSHAINDRA KUMAR KAURAV, J. (ORAL)
CM APPL. 2533/2026 (filed by P-2 seeking suspension of LOC and
permission to travel)
CM APPL. 4225/2026 (filed by P-1 seeking suspension of LOC and
permission to travel)
The instant petition is seeking quashing of the Look-Out Circular(s)
(„LOCs’) issued by the Union of India („UOI‟), at the behest of respondent
Nos. 2 and 3- Banks.
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 2 of 24 KUMAR KAURAV
2. The present applications have been moved by petitioners seeking
suspension of the LOC(s), issued against them and permission to travel
abroad. Petitioner no. 1 seeks to travel to the United States of America
(USA), United Kingdom (UK), Switzerland and Mexico for a period of three
weeks, falling within the period from 10.02.2026 to 30.03.2026 and
petitioner No.2 seeks to travel to Indonesia, Thailand, Vietnam and
Cambodia from 05.03.2026 to 30.03.2026
3. It is the case of the petitioners that the sole basis for issuance and
continuation of the LOC(s) is their alleged association as
Promoters/Directors of M/s Parabolic Drugs Ltd. („PDL‟), which had
availed credit facilities from a consortium of banks, including Respondent
Nos. 2 and 3. The accounts of PDL were declared as “fraud” by the said
respondents on 03.05.2016 and 18.05.2018, pursuant to which complaints
were filed before the Central Bureau of Investigation („CBI‟).
4. Consequent thereto, FIR No. RCBD1/2021/E/0010 dated 29.12.2021
came to be registered by the CBI under Sections 120-B, 406, 420, 467, 468
and 471 of the IPC, 1860 and Sections 13(2) read with 13(1)(d) of the
Prevention of Corruption Act, 1988. An ECIR bearing No. CDZO-I/01/2022
dated 06.01.2022 was, thereafter, registered by the Enforcement Directorate
(„ED‟), and a prosecution complaint has since been filed.
5. The petitioner No. 1 seeks permission to travel abroad for the stated
period in order to meet his daughters and spend time with his family. So far
as petitioner No. 2 is concerned, he seeks permission to travel abroad during
the aforesaid period to attend the wedding of his childhood friend‟s daughter
and to spend time with his family and close friends.
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 3 of 24 KUMAR KAURAV
6. It is not in dispute that this Court, vide order dated 06.06.2025, had
earlier permitted the petitioners to travel abroad, subject to conditions,
which have been duly complied with.
7. It is further noted that the petitioners have already been granted
permission to travel abroad by the Special Judge, ED Court, Chandigarh
vide order dated 09.12.2025 and by the Special Judge, CBI Court,
Chandigarh vide order dated 10.12.2025. In the order dated 10.12.2025
passed by the Special Judge, CBI Court, Chandigarh, it appears that LOC
issued by the CBI stood closed w.e.f. 01.08.2024, and the same is no longer
in force. The respondent No. 2, however, opposes the applications on the
ground that the fraud is of high magnitude.
8. At this stage, it is noted that rather than considering the applications,
the Court, in the facts of the instant cases, deems it appropriate to consider
the main petition on its merits.
9. I have heard learned counsel for the parties and have perused the
record.
10. Before delving into the discussion of the legal explication of the
regulatory framework governing the issuance of LOCs and the facts of the
instant case, it is apposite to note that freedom of movement, both domestic
and foreign, constitutes a core and inalienable facet of personal liberty and
operates as an indispensable precondition for the holistic development of the
human personality and livelihood. In foreign jurisprudence, the freedom to
travel has been recognised as a vital incident of individual liberty, shielded
by the guarantee of due process of law and embedded within the nation‟s
constitutional heritage. Freedom of movement across frontiers, as part of the
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 4 of 24 KUMAR KAURAV
nation‟s constitutional heritage, emphasises its intimate connection with
personal choice and human dignity.1
11. Moreover, in the Indian constitutional framework, the right to travel
and freedom of movement has been recognised as an intrinsic facet of the
fundamental right to life and “personal liberty” under Article 21 of the
Constitution of India. 2 The Supreme Court has held that while this freedom
is not expressly enumerated under any articles, it nonetheless commands
constitutional protection and may be restricted only by a procedure
established by law that is just, fair, and reasonable.
12. Bearing the aforesaid in mind, it is pertinent to delineate the evolution
of the guidelines governing the issuance of LOCs. As already noted by this
Court recently in Anant Raj Kanoria V. Union of India & Anr,3 the earliest
instructions emanated from a letter issued by the Ministry of Home Affairs
dated 05.09.1979, which authorised various agencies to monitor the arrival
and departure of Indian citizens as well as foreigners. Thereafter, a more
structured framework, confined to Indian citizens, was introduced by the
Office Memorandum dated 27.12.2000.
13. However, in 2010, this Court in Vikram Sharma v. Union of India4
and Sumer Singh Salkan v. Asst. Director5 further elucidated the legal
framework governing the issuance of LOC. In Sumer Singh Salkan, the
Court held that recourse to issuance of LOC where the accused was
deliberately evading arrest or not appearing in the trial Court despite non-
bailable warrants and other coercive measures, and there was a likelihood of
1
Reference to Kent v. Dulles, 357 U.S. 116 (1958)
2
Maneka Gandhi v. Union of India.(1978 1 SCC 248)
3
W.P.(C) 3313/2023 dated 09.01.2026
4
2010 SCC OnLine Del 2475
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 5 of 24 KUMAR KAURAV
the accused leaving the country to evade trial/arrest should be taken. The
Court, while answering the reference, held as under:-
“11. Look-out-Circular has also been issued against the petitioner as
the petitioner is an accused the Court of M.M. and he has not appeared
the Court of M.M. If the petitioner gives an undertaking the court for
his appearance on a particular date, through his counsel, the Look-out-
Circular issued against the petitioner shall be withdrawn within 24
hours of giving undertaking by the petitioner.
The questions raised in the reference are as under:
“A. What are the categories of cases in which the investigating agency
can seek recourse of Look-out-Circular and under what circumstances?
B. What procedure is required to be followed by the investigating
agency opening a Look-out-circular?
C. What is the remedy available to the person against whom such Look-
out-Circular has been opened?
D. What is the role of the concerned Court when such a case is brought
it and under what circumstances, the subordinate courts can intervene?
The questions are answered as under:
A. Recourse to LOC can be taken by investigating agency in cognizable
offences under IPC or other penal laws, where the accused was
deliberately evading arrest or not appearing in the trial court despite
NBWs and other coercive measures and there was likelihood of the
accused leaving the country to evade trial/arrest. B. The Investigating
Officer shall make a written request for LOC to the officer as notified
by the circular of Ministry of Home Affairs, giving details & reasons
for seeking LOC. The competent officer alone shall give directions for
opening LOC by passing an order in this respect.
C. The person against whom LOC is issued must join investigation by
appearing I.O. or should surrender the court concerned or should
satisfy the court that LOC was wrongly issued against him. He may
also approach the officer who ordered issuance of LOC & explain that
LOC was wrongly issued against him. LOC can be withdrawn by the
authority that issued and can also be rescinded by the trial court where
case is pending or having jurisdiction over concerned police station on
an application by the person concerned.
D. LOC is a coercive measure to make a person surrender to the
investigating agency or Court of law. The subordinate courts’
jurisdiction in affirming or cancelling LOC is commensurate with the
jurisdiction of cancellation of NBWs or affirming NBWs.
5 2010 SCC OnLine Del 2699 Signature Not Verified Signature Not Verified Signed By:AMIT KUMAR Signed SHARMA Signing Date:24.02.2026 By:PURUSHAINDRA 10:49:12 Page 6 of 24 KUMAR KAURAV
14. Subsequently, the Ministry of Home Affairs issued a comprehensive
Office Memorandum dated 27.10.2010, which confined the issuance of
LOCs to cases involving cognizable offences under the IPC or other penal
statutes, and restricted non-cognizable matters to intimation of travel
movements only.
15. Subsequent amendments, including the Office Memorandum dated
05.12.2017, further limited the scope of LOCs in exceptional circumstances
where the departure of a person was considered prejudicial to the
sovereignty, security, integrity of India, bilateral relations, strategic or
economic interests, or larger public interest, with further modifications
effected by the memorandums dated 19.09.2018 and 12.10.2018.
16. It is pertinent to note that in the context of the aforenoted office
memoranda, in Karti P. Chidambaram v. Bureau of Immigration6, the
Madras High Court held that a LOC is a coercive executive measure which
directly impinges upon personal liberty and, therefore, cannot be issued in a
mechanical or routine manner. The Court observed that under the governing
guidelines, an LOC can be resorted to only when there exists tangible
material indicating deliberate evasion of arrest or a real likelihood of the
individual fleeing the country.
17. However, in order to consolidate the directions for issuance of LOCs,
the Ministry of Home Affairs issued a comprehensive Office Memorandum
dated 22.02.2021, which presently governs the law with respect to the
issuance of LOCs. The relevant extract of said Office Memorandum is as
under :-
6 2018 SCC OnLine Mad 2229 Signature Not Verified Signature Not Verified Signed By:AMIT KUMAR Signed SHARMA Signing Date:24.02.2026 By:PURUSHAINDRA 10:49:12 Page 7 of 24 KUMAR KAURAV
“6. The existing guidelines with regard to issuance of Look Out
Circulars (LOC) in respect of Indian citizens and foreigners have been
reviewed by this Ministry. After due deliberations in consultation with
various stakeholders and in suppression of all the existing guidelines
issued vide this Ministry’s letters/O.M. referred to in para 1 above, it
has been decided with the approval of the competent authority that the
following consolidated guidelines shall be followed henceforth by all
concerned for the purpose of issuance of Look Out Circulars (LOC) in
respect of Indian citizens and foreigners:-
xxx xxx xxx
(H) Recourse to LOC is to be taken in cognizable offences under IPC
or other penal laws. The details in column IV in the enclosed proforma
regarding „reason for opening LOC‟ must invariably be provided
without which the subject of an LOC will not be arrested/detained.
(I) In cases where there is no cognizable offence under IPC or other
penal laws, the LOC subject cannot be detained/arrested or prevented
from leaving the country. The originating agency can only request that
they be informed about the arrival/departure of the subject in such
cases
xxx xxx xxx
(L) In exceptional cases, LOCs can be issued even in such cases, as
may not be covered by the guidelines above, whereby departure of a
person from India may be declined at the request of any of the
authorities mentioned in clause (B) above, if it appears to such
authority based on inputs received that the departure of such person is
detrimental to the sovereignty or security or integrity of India or that
the same is detrimental to the bilateral relations with any country or to
the strategic and/or economic interests of India or if such person is
allowed to leave, he may potentially indulge in an act of terrorism or
offences against the State and/or that such departure ought not be
permitted in the larger public interest at any given point in time.
18. The validity of the said Office Memorandum dated 22.02.2021, along
with earlier amendments issued by the Ministry of Home Affairs governing
the issuance of LOCs, fell for consideration before the Bombay High Court
in a batch of petitions, the lead matter being Viraj Chetan Shah v. Union of
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 8 of 24 KUMAR KAURAV
India and Ors.7. The principal challenge was to the constitutional validity of
amendments which enabled the Chairmen, Managing Directors, and Chief
Executive Officers of public sector banks to seek issuance of LOCs against
defaulting borrowers, thereby restraining their right to travel abroad.
19. The petitioners, therein, contended that such executive instructions
permitted a serious curtailment of personal liberty without any statutory
backing or prescribed procedure, in violation of Articles 14 and 21 of the
Constitution of India. It was urged that the right to travel abroad is an
integral facet of the right to life and personal liberty, and cannot be restricted
by executive fiat, particularly in matters arising out of civil or commercial
defaults.
20. Upon an overall consideration of the issues, the Court reiterated that
the right to travel abroad is an integral component of the right to life and
personal liberty under Article 21 of the Constitution, and any restriction
upon it must be founded on law and must follow a procedure that is fair,
just, and reasonable. The Court categorically held that fundamental rights
cannot be curtailed through executive instructions alone, in the absence of a
governing statute or a controlling statutory framework. The Court further
held that the Office Memoranda, viewed in their entirety, could not be
characterised as per se arbitrary or unconstitutional, so as to warrant their
wholesale invalidation. Nonetheless, the Court found a grave constitutional
infirmity in the inclusion of Chairmen, Managing Directors, and Chief
Executive Officers of all public sector banks under Clause 6(B)(xv) of the
Office Memorandum dated 22.02.2021. Such inclusion was held to be bad in
7
2024 SCC ONLINEBOM 1195
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 9 of 24 KUMAR KAURAV
law, being arbitrary and unreasonable, founded on an improper and invalid
classification, and resulting in the conferment of uncanalised, unguided, and
excessive power upon bank officials to seek restrictions on personal liberty
without any statutory guidance or procedural safeguards. It is also pertinent
to note that a Special Leave Petition has been filed assailing the decision in
Viraj Chetan Shah. However, the decision of the Bombay High Court has
not been stayed.
21. The decision in the case of Viraj Chetan Shah was also considered by
a coordinate bench of this Court in Sahil Chugh v. Union of India8,
wherein, it was held that LOC issued at the behest of a public sector bank
against borrowers/directors merely on account of loan default or declaration
as wilful defaulters, in the absence of any criminal proceedings, are
unsustainable in law. It was emphasized that the expression “detrimental to
the economic interests of India” under the MHA guidelines is meant for
exceptional cases involving grave, systemic or national economic impact,
and not routine commercial defaults. Since in the facts of the case therein no
FIR, charge-sheet, or cognizable offence was pending against the petitioner,
and the disputes were purely civil and pending before the DRT, the Court
quashed the LOC as arbitrary and disproportionate. The relevant extract of
the aforesaid decision is extracted as under:-
21. It is well settled that merely because the Office Memorandum
permits the issuance of a lookout circular in exceptional
circumstances, even when an individual is not involved in any
offence under the IPC or any other penal law, the said power
should be used in exceptional circumstances and not as a matter of
routine.
8
W.P.(C) 6623/2024
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 10 of 24 KUMAR KAURAV
22. This Court in Apurve Goel v. Bureau of Immigration, W.P.(C)
5674/2023, has held as under:–
“22. The Look Out Circulars cannot be opened merely on the
request of the banks. There has to be some application of mind by
the authority concerned opening the Look Out Circular since the
opening of Look Out Circular results in restraining a person’s right
to travel abroad. The authority opening the Look Out Circular must
satisfy itself that the departure of a person against whom Look Out
Circular has been opened would be detrimental to the sovereignty
or security or integrity of India or that the same is detrimental to
the bilateral relationship with any country or to the economic
interests of India or departure of such a person ought not be
permitted in the larger public interest at any given point in time.”
23. It is well settled that mere inability to pay money without there
being a criminal case cannot be a reason to take away the
Fundamental Right guaranteed under Article 21 of the Constitution
of India. Right to travel abroad has been held to be a Fundamental
Right under Article 21 of the Constitution of India which cannot be
taken away in an arbitrary and illegal manner.
24. In Maneka Gandhi v. Union of India, (1978) 1 SCC 248, the
Apex Court has held as under:
“5. …Thus, no person can be deprived of his right to go abroad
unless there is a law made by the State prescribing the procedure
for so depriving him and the deprivation is effected strictly in
accordance with such procedure. It was for this reason, in order to
comply with the requirement of Article 21, that Parliament enacted
the Passports Act, 1967 for regulating the right to go abroad. It is
clear from the provisions of the Passports Act, 1967 that it lays
down the circumstances under which a passport may be issued or
refused or cancelled or impounded and also prescribes a procedure
for doing so, but the question is whether that is sufficient
compliance with Article 21. Is the prescription of some sort of
procedure enough or must the procedure comply with any
particular requirements? Obviously, the procedure cannot be
arbitrary, unfair or unreasonable. This indeed was conceded by the
learned Attorney-General who with his usual candour frankly
stated that it was not possible for him to contend that any procedure
howsoever arbitrary, oppressive or unjust may be prescribed by the
law….”
25. A Division Bench of the High Court of Bombay in a batch of
writ petitions vide Judgment dated 23.04.2024 in Viraj Chetan Shah
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 11 of 24 KUMAR KAURAV
v. Union of India, W.P.(C)719/2020 etc. has quashed Clause
8(b)(xv) of the Office Memorandum dated 27.10.2010 bearing O.M.
23016/31/2010-Imm. equivalent to Clause 6(B)(xv) of the O.M.
dated 22.02.2021 bearing O.M. 25016/10/2017-Imm.(Pt.) whereby
the Chairman/Managing Director/Chief Executives of all Public
Sector Banks could request for opening of an LOC. The effect of the
said judgment is that the Chairman/Managing Director/Chief
Executives of the Public Sector Banks cannot make a request for
issuance of LOC.
26. The issuance of lookout circular cannot be resorted to in every
case of bank loan defaults or credit facilities availed for business
and the Fundamental Right of a citizen of the country to travel
abroad cannot be curtailed only because of failure to pay a bank
loan more so when the person against whom the lookout circular is
opened has not been even arrayed as an accused in any offence for
misappropriation or siphoning off the loan amounts.”
22. One of the respondents therein, i.e, Bank of Baroda, challenged the
aforenoted decision of the Single Judge before the Division Bench in Bank
of Baroda v. Sahil Chugh.9 The Division Bench, while dismissing the
appeal, has held as under :-
“12. Having heard the learned counsel for the parties and minutely
examining the records, we find no reason to interfere or interdict the
impugned judgment passed by the learned Single Judge.
13. So far as the OM dated 22.11.2018 issued by the Ministry of
Finance is concerned, it is apparent that the Nodal Ministry which has
the authority and jurisdiction to issue policies and guidelines in respect
of the regime surrounding issuance of LOCs, is the MHA. That apart,
even if we take the contents of para 3 of the said OM on its face value,
it would, at best, amount to an advisory, over and above the guidelines
of the MHA. Other than that, we cannot conceive that the same would
be of a binding nature.
14. That apart, the other argument in respect of the term “detrimental
to economic interest” is concerned, we find that in para 82 of Prateek
Chitkara (supra), the Court noted that issuance of LOC cannot be
resorted to in each and every case of bank defaults or credit facility
availed of for business etc., and that citizens ought not be harassed or
deprived of their liberty to travel merely due to their participation in9
2025 SCC OnLine Del 9282Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 12 of 24 KUMAR KAURAV
business, whether in a professional or in a non-executive capacity. In
fact, it was clearly observed that the circumstances surrounding
issuance of an LOC have to reveal a higher gravity and a larger impact
on the country. We agree with the said observations and find that the
same would be squarely applicable to the facts of the present appeals.
The learned Single Judge had also relied upon the judgment of this
court in Apurve Goel v. Bureau of Immigration, W.P.(C) 5674/2023,
rendered on 19.09.2023, particularly in para 22, which noted that the
authority opening the LOC must satisfy itself that the departure of a
person against whom an LOC has been opened, would be detrimental
to sovereignty or security or integrity of India or that the same is
detrimental to the bilateral relationship with any country or to the
economic interest of India. In the absence of such foundational facts as
laid down, the sustenance of an LOC cannot be upheld.
15. Merely, the inability to repay the debt, without there being a
criminal case, cannot be a reason to deprive a citizen of this country of
the fundamental rights envisaged and guaranteed under Article 21 of
the Constitution of India.
16. Lastly, learned counsel for the appellant bank was unable to
provide any counter argument or judgment to the ratio laid down by the
Division Bench of the High Court of Bombay vide its judgment dated
23.04.2024 in W.P.(C) 719/2020 titled Viraj Chetan Shah v. Union of
India, whereby Clause 8 (b) (xv) of the OM dated 27.10.2010 which
was equivalent to Clause 6(B)(xv) of the OM dated 22.02.2021,
empowering the Chairman/Managing Director/Chief Executive of all
Public Sector banks who could make request for opening an LOC, was
quashed. The very right, authority and jurisdiction of the Principal
Officers of the Public Sector Banks to make a request for issuance of
LOC having been divested, the question of relying on the OM issued by
the Ministry of Finance etc., would be rendered meaningless. Thus, the
contention predicated on the said OM is unpersuasive.
17. Learned counsel for the appellant bank had also contended that the
right to freedom to movement or travel, though a fundamental right yet,
is neither unfettered nor unrestricted, and therefore the appellant bank
has every right to seek issuance of LOCs against persons or institutions
which have been declared as wilful defaulters. The argument, no doubt,
appears to be attractive, however, lacks substance. Undoubtedly, the
right to freedom to travel may not be an unrestricted or unfettered
right, however, the restrictions or fetters pitched against such
fundamental rights have to pass the test of judicial review. Keeping in
view the aforesaid judgments as also the ratio laid down by the
Division Bench of the Bombay High Court in Viraj Chetan (supra),
quashing the very power and jurisdiction of the banks to seek issuance
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 13 of 24 KUMAR KAURAV
of LOCs, there cannot be any restriction which we could read
prohibiting the travel of the respondents freely. In that view of the
matter, the said submission has no merits.”
23. It is also pertinent to note the decision of this Court in Rajesh Kumar
Mehta v. Union of India.10 The relevant extract of the aforenoted decision
reads as under: –
“18. In terms of the said OM, an LOC can be issued at the request of
the Chairman/Managing Directors/Chief Executive of all Public Sector
Banks. A request is given by a person, who is authorized under the said
OM, to the Bureau of Immigration and then the Bureau of Immigration
at the request of the said Officer opens the Lookout Circular.
19. The Office Memorandum indicates that the legal liability of the
action taken by the immigration authorities in pursuance of the Lookout
Circular rests with the Originating Agency, in this case, the Bank of
Baroda.
20. Clause L of the Office Memorandum of 2021, as quoted above,
states that in exceptional cases, an LOC can be issued at the instance of
the Bank if the authorities are of the view that letting the person to
depart from the country will be detrimental to the economic interests of
India.
21. A perusal of the abovementioned Clause L of the Office
Memorandum shows that in exceptional circumstances Lookout
Circulars can be issued even in such cases which are not covered by
the said guidelines which can be issued even when there is no criminal
case against the person and person against whom investigation is
pending and if it appears to the authorities based on the inputs that the
departure of such person is detrimental to the sovereignty or security
or integrity of India or bilateral relations or the strategic and/or
economic interests of India. the term „detrimental to the economic
interests of India‟ has been well defined in several judgments.
***
25. Lookout Circular has been issued against the Petitioner only
because of the inability of the company to repay its debts for which the
Petitioner stood guarantee. There are no criminal proceedings against
the Petitioner and there is no allegation that the Petitioner was
instrumental in defalcation or siphoning off the money. The Bank has10
2024 SCC OnLine Del 4153Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 14 of 24 KUMAR KAURAV
already initiated steps against the Petitioner and the company by taking
steps under the RDDB Act, SARFAESI Act and under the IBC. This
Court is of the opinion that after resorting to all the remedies available
in law, the Bank cannot open a Lookout Circular as an arm-twisting
tactic to recover debt from a person who is otherwise unable to pay
more so when there are no allegations that he was engaged in any
fraud or in any siphoning off or defalcation of the amounts given as
loan.
26. Lookout Circular is a major impediment for a person who wants
to travel abroad. There is plethora of judgments which states that no
person can be deprived of his right to go abroad other than for very
compelling reasons. In Maneka Gandhi v. Union of India, (1978) 1
SCC 248, the Apex Court has held as under:–
“5. …Thus, no person can be deprived of his right to go abroad
unless there is a law made by the State prescribing the procedure
for so depriving him and the deprivation is effected strictly in
accordance with such procedure. It was for this reason, in order
to comply with the requirement of Article 21, that Parliament
enacted the Passports Act, 1967 for regulating the right to go
abroad. It is clear from the provisions of the Passports Act, 1967
that it lays down the circumstances under which a passport may
be issued or refused or cancelled or impounded and also
prescribes a procedure for doing so, but the question is whether
that is sufficient compliance with Article 21. Is the prescription of
some sort of procedure enough or must the procedure comply
with any particular requirements? Obviously, the procedure
cannot be arbitrary, unfair or unreasonable. This indeed was
conceded by the learned Attorney-General who with his usual
candour frankly stated that it was not possible for him to contend
that any procedure howsoever arbitrary, oppressive or unjust
may be prescribed by the law….”
27. In view of the above, the Lookout Circular (LOC) issued against the
Petitioner is hereby quashed.
24. In Shalini Khanna v. Union of India,11 also, this Court held as
under: –
“20. Though Paragraph (L) of the aforesaid Office Memorandum
permits the Banks to issue a request for opening a lookout circular, in11
2024 SCC OnLine Del 837Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 15 of 24 KUMAR KAURAV
exceptional cases, even if they are not covered by the guidelines, even
in such of those cases, the same can be issued only if departure of such
person is detrimental to the sovereignty or security of the country, or
departure of the person is threat to the bilateral relations to any
country, or to the strategic or economic interest of the country, or if
such person is allowed to leave, he may potentially indulge in acts of
terrorism or offences against State or that such departure ought not be
permitted in larger public interest at any given point of time.
21. It is well settled that merely because the Office Memorandum
permits the issuance of a lookout circular in exceptional
circumstances, even when an individual is not involved in any offence
under the IPC or any other penal law, the said power should be used
in exceptional circumstances and not as a matter of routine.
22. The term „detrimental to the economic interests‟ must be of such a
magnitude that it can significantly affect the economic interest of the
country. In the present case, the total loan amount disbursed is about
Rs. 7 crores and even if one adds the interest to it, it cannot be said that
the amount is so large that it will affect the economic interests of the
country.
23. The issuance of lookout circular cannot be resorted to in every case
of bank loan defaults or credit facilities availed for business and the
Fundamental Right of a citizen of the country to travel abroad cannot
be curtailed only because of failure to pay a bank loan more so when
the person against whom the lookout circular is opened has not been
even arrayed as an accused in any offence for misappropriation or
siphoning off the loan amounts.”
25. Moreover, in Anastasiia Pivtsaeva & Anr. v. Union of India &
Ors.12, this Court held that mere association or a familial relationship with
an accused, absent any concrete material showing direct involvement or
complicity in the alleged offence, cannot justify adverse action such as
denial of security clearance or the continuation of coercive measures.
26. A comprehensive discussion of the law with respect to LOC has also
been undertaken by the Court in Puja Chadha v. Directorate of
12
2024 SCC OnLine Del 5170
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 16 of 24 KUMAR KAURAV
Enforcement.13 The Court, while relying on the decisions in the cases of
Prashant Bothra v. Bureau of Immigration 14Dhruv Tewari v. Directorate
of Enforcement 15 Sumer Singh Salkan , Brij Bhushan Kathuria v. Union
of India16and Anastasiia Pivtsaeva, held that the power to issue an LOC is
an exceptional and coercive measure which has a direct bearing on an
individual‟s fundamental right to travel, and therefore must be exercised
strictly in accordance with law. Emphasising the aforesaid, this Court in the
case of Sandeep Dhanuka v. Directorate of Revenue Intelligence, 17 has
also dealt with various aspects of the issuance of LOC and its continuation.
The relevant extract of the aforesaid decision reads as under:-
“40. The aforementioned Office Memorandums have been examined
and interpreted in several other judicial pronouncements as well.
41. In Prashant Bothra v. Bureau of Immigration., 2023 SCC OnLine
Cal 2643, it was held as under:
“39. In the present case, as rightly pointed by learned counsel for the
petitioners, the stage of investigation within the contemplation of
Section 212(1) – (4) of the 2013 Act is not yet over. Thus, as of today,
whatever may the allegations against the petitioners or the Company of
which they were Directors and guarantors, the same cannot tantamount
to a cognizable offence against the petitioners.
xxx xxx xxx
47. The said citation by the SFIO is not relevant in the present case. In
the present case, no “trial” has started and/or any arrest has been
made or sought to be made. There is no issuance of NBW at all in the
present case or even warrant, for that matter. Clause 4(a) of the Office
Memorandum, quoting the Delhi High Court, clearly envisages that
there has to be a cognizable offence where the accused was deliberately
evading arrest or not appearing in a Trial Court despite NBW and
other coercive measures and there was likelihood of the accused
leaving the country to evade trial/arrest. None of the said criteria are
met in the present case. On the contrary, Clause 6 of the Office
Memorandum dated February 22, 2021 provides that the existing13
2025:DHC:8787
14
2023 SCC OnLine Cal 2643
15
2022 SCC OnLine Del 1893
16
2021 SCC OnLine Del 2587
17
2025 SCC OnLine Del 8280Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 17 of 24 KUMAR KAURAV
guidelines with regard to issuance of LOC were being superseded and
it was decided as provided thereafter. The said consolidated guidelines,
thus, are spelt out in Clause 6.”
42. In Sumer Singh Salkan v. Asst. Director (supra), the Court has
observed as under –
“The questions raised in the reference are as under:
“A. What are the categories of cases in which the investigating
agency can seek recourse of Look-out-Circular and under what
circumstances?
B. What procedure is required to be followed by the investigating
agency opening a Look-out-circular?
C. What is the remedy available to the person against whom such
Lookout-Circular has been opened?
D. What is the role of the concerned Court when such a case is
brought it and under what circumstances, the subordinate courts
can intervene?
The questions are answered as under:
A. Recourse to LOC can be taken by investigating agency in
cognizable offences under IPC or other penal laws, where the
accused was deliberately evading arrest or not appearing in the
trial court despite NBWs and other coercive measures and there
was likelihood of the accused leaving the country to evade
trial/arrest.
B. The Investigating Officer shall make a written request for LOC
to the officer as notified by the circular of Ministry of Home
Affairs, giving details & reasons for seeking LOC. The competent
officer alone shall give directions for opening LOC by passing an
order in this respect.
C. The person against whom LOC is issued must join
investigation by appearing I.O. or should surrender the court
concerned or should satisfy the court that LOC was wrongly
issued against him. He may also approach the officer who
ordered issuance of LOC & explain that LOC was wrongly issued
against him. LOC can be withdrawn by the authority that issued
and can also be rescinded by the trial court where case is
pending or having jurisdiction over concerned police station on
an application by the person concerned.
D. LOC is a coercive measure to make a person surrender to the
investigating agency or Court of law. The subordinate courts’
jurisdiction in affirming or cancelling LOC is commensurate with
the jurisdiction of cancellation of NBWs or affirming NBWs.”
43. In Brij Bhushan Kathuria v. Union of India, 2021 SCC OnLine Del
2587, this Court has made the following observation –
“14…….An LOC has the effect of seriously jeopardising the right
to travel of an individual. The settled legal position, as per theSignature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 18 of 24 KUMAR KAURAV
judgment in Sumer Singh Salkan (supra) is that unless and until
there is an FIR which is lodged or a criminal case which is
pending, an LOC cannot be issued.
xxx xxx xxx
18. It is clear from a perusal of clauses (g), (h) and (j) that unless
and until the conditions in these clauses are satisfied, prima-facie
an LOC cannot be opened.
19. There is no criminal case pending against the Petitioner. His
role is also yet to be ascertained by the investigating authorities.
Phrases such as „economic interest‟ or „larger public interest‟
cannot be expanded in a manner so as to include an Independent
Director who was in the past associated with the company being
investigated, without any specific role being attributed to him, as
in the present case……”
44. Similarly in Ashutosh Sharma v. Union Of India., W.P. (C) 7769 of
2022, the Court has observed as under –
“6. It is also to be noted that there are no complaint/criminal
proceedings pending against the Petitioner.
7. Since 30th November 2019, the Impugned LOC against the
Petitioner has been in place. The rationale behind issuing the
instant LOC is to effectively monitor the entry or exit of the
Petitioner from the country.
8. However, there is no material placed before the Court which
can ascertain the Petitioner’s liability or criminal culpability at
this juncture which could indicate that he is intending to abscond.
Therefore, the mere apprehension of default cannot be a basis for
opening an indefinite LOC against him, thereby restricting the
movement of a citizen who has a right to travel abroad which is
acknowledged to be a fundamental right under Article 21 of the
Constitution of India, as observed in the landmark judgments of
Maneka Gandhi v. Union of India and Satwant Singh Sawhney v.
D. Ramarathnam, Assistant Passport Officer.
xxx
12. The above makes it clear that only in exceptional cases can a
LOC be issued without fulfilling the parameters. This is because a
person’s right to travel freely is an expression of their
fundamental right to personal liberty enshrined under Article 21
of the Constitution. Therefore, such a right can only be restricted
under strict parameters and in accordance with the procedure
established by law.”
45. Reference is also apposite to Hulas Rahul Gupta v. Bureau of
Immigration (supra), wherein the Court has observed as under –
18. The abovementioned guidelines show that the ordinary
recourse to open LOCs is to be taken in cognizable offence under
IPC and other penal laws. However, in exceptional
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 19 of 24 KUMAR KAURAV
circumstances, LOCs can be opened in such cases which are not
covered by the guidelines if it is felt that the person concerned if
leaves the country would be against the economic interest of the
country.
19. It is now a settled law that opening of an LOC has a very
serious effect on a person’s fundamental right to travel abroad
which is on the face of Article 21 of the Constitution of India and
the said right to travel cannot be curtailed without following due
process. It is also settled law that recourse to LOC can be taken
by the Investigating Agencies primarily when there is a
cognizable offence under IPC or in any other penal laws or
where the accused is deliberately evading the arrest and not
appearing before Court despite summons being served on him or
issuance of non-bailable warrants or when other coercive
measures have been taken by the Court to ensure his appearance
in the Court and that there is likelihood of the accused to leave
the country to evade such trial or arrest.
20. The LOCs are also being issued at the instance of
Investigating Agencies where apprehension is raised by the
Investigating Agencies that the person who is alleged of
committing an offence might escape the clutches of law by
leaving the country. However, the law is also getting crystallized
that merely because there are some revenue implications, the
LOC cannot be opened against a person. A Single Bench of this
Court in Priya Parameswaran Pillai v. Union of India, [2015 VII
AD (Delhi) 10] has held that merely because there were some
revenue implications due to notices issued by the Income Tax
Authorities, the violations of tax laws are not demonstrative of the
fact that the Petitioner therein had acted inimical to the economic
interests of the country.
27. Recently, this Court in Anant Raj Kannoria, Vineet Gupta v. Union
of India & Ors18, Maria Ramesh V. Union of India & Ors19 and Ritwick
Dutta v. Union of India & Ors 20 has also examined the various aspects of
the legal framework governing the issuance of LOC. In Anant Raj
Kannoria, this Court has held that the mechanical continuation of a LOC, in
the absence of any necessity for the petitioner’s participation in the
18
W.P.(C) 15701/2022 dt 22.01.2026
19
W.P.(C) 15701/2022 dt. 27.01.2026
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 20 of 24 KUMAR KAURAV
investigation, renders such restraint prima facie arbitrary, particularly where
the petitioner has neither evaded the process of law nor exhibited any intent
to obstruct the investigation. The Court further observed that repeated
invocation of the writ jurisdiction for interim reliefs in such matters places
an avoidable burden on judicial time, which could otherwise be devoted to
cases involving substantive rights and pressing questions of law.
28. On the conspectus of the aforenoted decisions and memorandum, it is
seen that the following guiding principles emerge governing the issuance,
continuance, and judicial review of LOC:
(i) LOC constitutes a coercive executive measure having a substantial
impact on the fundamental right to travel, which forms an integral facet
of the right to life and personal liberty guaranteed under Article 21 of the
Constitution of India. Consequently, the power to issue an LOC must be
exercised sparingly, strictly in accordance with law, and only upon
satisfaction of the conditions prescribed under the governing Office
Memoranda;
(ii) An LOC may be issued only in cases involving a cognizable
offence under the relevant statutes, where specific, tangible material
demonstrates that the person concerned is deliberately evading arrest or
judicial process, or that there exists a real and proximate likelihood of
absconding;
(iii) Moreover, the exceptional power under Clause 6 (L) of the
Office Memorandum dated 22.02.2021 is to be narrowly construed and20
W.P.(C) 12862/2023 dt. 02.02.2026Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 21 of 24 KUMAR KAURAV
may be exercised only in rare and compelling cases, where, the proposed
departure of subject poses a clear and grave threat to the sovereignty,
security, or integrity of India, or to its strategic or economic interests in a
national or systemic sense, or the larger public interest;
(iv) An LOC issued at the instance of Chairman, Managing
Director, or Chief Executive Officers of Public Sector Banks, would not
withstand the scrutiny of law and judicial review. Thus, as of now, the
LOC issued to Public Sector Banks cannot be sustained and are liable to
be quashed;
(v) Courts, in exercise of writ jurisdiction, are duty-bound to
subject the issuance and continuation of LOCs to strict scrutiny,
balancing the legitimate interests of the State with the individual‟s
fundamental rights, and to quash such circulars where the restraint
imposed is found to be arbitrary, disproportionate, lacking in statutory
backing, or violative of the principles of fairness, reasonableness, and
due process. Ultimately, the burden lies squarely upon the “originating
agencies” to justify, the necessity, proportionality, and legality of the
restraint, failing which such action cannot be sustained. Pertinent to
observe that the continuance of an LOC is not indefinite and must be
periodically reviewed. Where it is evident from the record that the
subject has cooperated with the investigation, has not evaded the process
of law, and where no further interrogation or presence is demonstrably
required, the continued operation of an LOC would amount to an
unreasonable and unjustified restriction on personal liberty;
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 22 of 24 KUMAR KAURAV
(vi) However, it is also to be emphasised herein that the Writ Court
is not the exclusive grievance redressal mechanism available to a person
against whom a LOC has been issued. As held in Sumer Singh Salkan,
a person against whom a LOC is issued is, in the first instance, required
to join the investigation or surrender before the jurisdictional Court, or
otherwise satisfy the Court that the LOC is unwarranted. The individual
may also approach the authority which ordered issuance of the LOC and
seek its withdrawal on the grounds of illegality or non-application of
mind. An LOC may be withdrawn by the originating authority and may
also be rescinded or modified by the trial Court or the Court having
jurisdiction over the concerned police station, upon an appropriate
application.
29. On the anvil of the aforesaid discussion, there does not seem to be any
justification to continue the existence of the LOC(s) in the instant case.
Accordingly, LOC(s) is quashed with the following directions:
i. The petitioners to submit an undertaking before the Special Judge,
PMLA Court, Chandigarh and the Special Judge, CBI Court,
Chandigarh, affirming that they shall continue to cooperate with the
investigation, if any, and they shall appear before the concerned trial
Court as and when required, rendering full cooperation in the early
disposal of trial.
ii. Henceforth, they shall undertake abroad journey with the prior
permission is obtained from the competent Courts, where the trial is
pending.
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 23 of 24 KUMAR KAURAV
30. With the aforesaid directions, the petition stands disposed of along
with all pending applications.
PURUSHAINDRA KUMAR KAURAV, J
FEBRUARY 10, 2026/p/mj.
Signature Not Verified Signature Not Verified
Signed By:AMIT KUMAR Signed
SHARMA
Signing Date:24.02.2026 By:PURUSHAINDRA
10:49:12 Page 24 of 24 KUMAR KAURAV